Bill Holter – In 2009 Recession Something Big Was Missed China Sets The Gold Price | X22 Report
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Make sure to use the promo code X 20 at checkout. And hurry, we only have a limited supply available. Or just click the link in the description hi and welcome to the X 22 Report Spotlight. Today we have a returning guest, Bill Holter. Bill is a financial writer, gold expert. He helps individuals purchase and store precious metals. You can find his work on billholter. com and I am very happy to have Bill back on the X 22 Report spotlight.
Bill, welcome back to the spotlight. Thank you for having me back, Dave. Hey, thanks for being here and I just wanted to get your take because Biden’s out there and he’s telling everyone that the economy is great. Everyone has jobs. Inflation’s under control. Fuel prices are under control. When you look at the economy and you see what’s going on, what’s your take on what’s happening with the economy right now? Well, everything that they’re saying is complete bullshit.
Just like everything else in the world has turned into lie to your face and you’re supposed to believe it. I mean, just, I mean, look at, look at inflation. Inflation is obviously running hotter than 3%. Look at unemployment. I mean, even within the unemployment numbers, they show the amount of people who no longer are looking for jobs. Every single, every single metric that they put out is a lie right to your face.
And the lies are getting so big now that even the average person understands that there’s something really wrong. I mean, if everything was fine, then why are hotels empty? And why is there such a collapse in commercial real estate? There’s just, there’s too many real world events or things that you can see with your own eyes that are totally opposite of what we’re being told by the media, by government, etcetera.
Did you hear that? They want to take the inflation rate and they want to set it to 3% instead of 2% now. Yeah, actually, I saw the number three and a half percent, but that’s splitting hairs. Yeah. If you can’t get it down to 2%, just change your goal. And that’s what they do. I mean, they change, they change the finish line, they change the objective to meet what can be done.
No, and I see that what’s very interesting about inflation is that when we saw inflation go up five, six, 7%, and they said, okay, now everything’s back to normal. The people aren’t feeling that everything went back to normal. They’re still feeling that inflation. So people, well, it’s the new normal. Yeah, I mean, where we are now is the new normal. We’re never going to go back to the way it was five or ten years ago, and we’re certainly never, ever, ever going to go back to the way it was 30 or 40 years ago.
John Williams is a perfect example. John does his calculations based on the way the numbers were crunched for employment, for inflation. He crunches those numbers based on the way they were tabulated back in the 1980s. And, I mean, everything has become so convoluted and so bastardized as far as the calculations and the tabulations, it’s, I mean, it’s way more than massaging statistics, it’s recreating. They’re trying to recreate the world that we live in, or the perceived world that we live in.
Do you think that the Fed will actually cut rates? Because we started out this year and they were telling us they were going to cut rates six times this year, then it went to four, and now it looks like it’s two. Do you think they’ll ever cut rates this year? Yeah, I think they’re going to be forced, I think where the fed goes from here, they’re going to be forced, I think they’ll be forced to cut rates at some point.
Maybe in the next month or two, you get some type of negative financial event, because remember, we live in the most highly indebted system ever. And they’ve raised rates on that system. So it’s, I’m going to say that it’s a planned takedown, but something’s going to break. If it does break, the Fed will be forced to cut. And once they cut rates, then you’re going to see the dollar itself get smoked.
And it’s my opinion that you’re going to see much higher rates than where we are right now to defend or protect the dollar. And remember, the dollar is the world’s reserve currency. So with a declining dollar or deflating dollar, what that’s going to do is it’s going to, it’s going to basically destroy western central banks because the dollar is the largest reserve that all these western central banks hold.
So are you saying that when they’re forced to cut rates, we’re going to see hyperinflation? Yeah, when they’re forced to cut rates, then you’re going to see the dollar really begin to drop. And I mean, I could see this year, I could see the dollar trade into the, into the eighties, if not the seventies, on the USDX. And remember, that’s versus other currencies. That’s not versus gold, silver, oil or even a cup of coffee.
So yeah, I do believe that we’re going to, we are headed for a high, I believe we’re headed for a hyperinflation of the things we need and a hyper deflation of the things we own. And when I say the things we own, I’m talking about of houses, investments, etcetera. Those are going to hyper deflate. At the same time, the cost of living is going to increase rapidly. And as far as the asset side is concerned, the reasoning behind that is assets have been bid up and have been held up with the use of credit.
And you know that I’ve said all along, when this thing finally breaks, it will be a credit event. And credit will be extremely difficult, if not impossible to obtain. And there’s your asset deflation because there’s not enough cash out there to hold asset prices up one giant margin. So you’re saying like corporate, when credit freezes up, corporations, they won’t be able to borrow, people won’t be able to borrow.
Business will just come to a screeching halt. Right. And you might even add in there, governments are going to have a hard time borrowing. I mean, as far as the US treasury is concerned, their only avenue to borrow would be go directly to the Federal Reserve and have them buy treasury bonds. So by cutting the rate and having inflation, do you think the market then is going to come down.
I know on your site on billhelter. com, comma, you have a graph of stocks. And since we’re discussing inflation, cutting the rates, do you think the market at that point would start to all of a sudden come down? Right. Well, we’ve already had a hyperinflation, if you will, in asset prices. And I mean, you can look at charts of stocks. I mean, you can see that. You can see we’ve had a hyperinflation.
And what I’m getting at is something is going to break more than likely in the banking system, but definitely in the financial system, and that’s going to force the Fed’s hand to cut. Right now, I think the Fed would prefer to do nothing and to do nothing as long as they can do nothing. But like I said, I think they will be forced because of something breaking, they’ll be forced to lower rates.
And once they lower rates, then you’re going to see the dollar start to wane. And as that picks up speed, then the Fed is going to be forced to raise rates because they’re going to realize that the dollar is unwinding. And don’t forget, I mean, we’re talking about interest rates now. We’re talking about relative values. But if you look at what the BRICs are doing, the BRICs have moved away from the dollar, so there’s less demand for the dollar and they are intent on replacing the dollar as the world’s reserve currency.
And I mean, if you destroy a currency, you destroy a nation. And what you’re looking at is basically end of empire. So when the dollar starts to devalue rapidly, I mean, we’re seeing gold now. I mean, I can’t believe that gold is at 2122 hundred right now. Do you think they’re going to lose control over the paper gold market? And gold then is going to really start to move up, no question about it.
And that may even be, it may not be a bank, it may be a failure to deliver. And gold and silver are exploding, bringing, pulling other commodities. And basically there’s your unwinding of the dollar. It would be basically the unmasking of the emperor has no clothes if you had a failure to deliver. And paper contracts basically went away and it became a cash and carrying gold and silver became a cash and carry market worldwide without any financial derivatives attached to them.
So do you think gold could hit as high as bitcoin? You can’t pick a number. I mean, if you do the math right now, if the federal debt had to be paid if foreigners demanded gold in lieu of dollars. If we truly have the 8300 tons that we say we have, and you divide that into 34 trillion, which obviously is not all the debt. It’s probably a 6th of the debt or a 7th of the debt.
But if you did that math, you’re over $125,000. And I’ve said, anybody who gives you a price, a price target on gold, they’re making it up because you don’t have the numerator or the denominator. You can’t, you don’t know if the 8300 tons really exists, if it’s really there, and you have no idea how much money supply is going to come forth. You have no idea how much more debt is going to be piled up.
So there’s no way to do a calculation. And while we’re talking about calculations, because you brought up bitcoin, you know, I’ve seen people say, well, bitcoin is going to be 100,000 or 200,000. Based on what math, first off, I mean, there’s just. There’s. There’s no way to do it, because, again, the numerator and denominator. Yes, the denominator is what, 21. 21 million bitcoin. But then you get to ask, what is a bitcoin? I mean, are those.
Are they 21 million particles of air without a. If the Internet goes down, if the grid goes down, that becomes useless. It becomes, you cannot, you can’t get to it, you can’t use it, you can’t trade it, you can’t do anything with it. And that is a real possibility. I mean, how many. For how many years have they talked about an EMP? Yeah, well, I just saw. I think Blinken was just out there telling everyone that they have information that Iran is going to cyber attack the water infrastructure, and we could see cyber attacks in this country.
So it looks like they’re already building the narrative that something is going to happen. So do you think. Well, I don’t think they. I don’t think any. Yeah, I don’t think anybody needs to build a narrative. Something really bad is happening just based on. I mean, look where we are. Look. Look at the country from a social aspect, look at the country from a financial aspect. Look at the country from a military aspect.
I mean, we are. We are now not even a shadow of what we were 50 years ago. So do you think that they are planning something, maybe to cover up this economic event that is coming? Dave, you and I talked. I’m going to say it was, gosh, probably years ago. It’s my opinion that they are going to have to kick the table over so that they can say our policies were working, everything was fine, except for whatever the event is.
They’re going to have to bring out some type of false flag so that they don’t take the blame for their policies because they’re going to say our policies were working fine, except this happened and it wasn’t our fault. They’re going to kick the table over and they’re going to have to do that because mathematically this whole game is over. I mean, the most obvious of that is look at the US debt.
We’re borrowing a trillion dollars every hundred days and the debt service is now over a trillion dollars. It’s not mathematically feasible. It cannot be paid off. This reminds me, I mean, it’s very similar to 2008 2009 because back then we were in an election year and Bernanke was out there in the very beginning telling everyone everything is fine, Biden is out there and Janet Yellen’s out there saying, oh, soft landing, soft landing, it’s fine.
And it’s starting to remind me of 2008 2009, but a lot worse now. And we’re in that same presidential election and I feel like the same things are happening just on steroids. Yeah, that’s exactly correct. On steroids. Yes. This is an election year and I am on record saying that at this point, I believe there’s better than a 50 50 chance that there is not an election. Because if you look at the polls, I mean, even national polls, you have Trump leading by, I don’t know, two points, three points, five points.
That’s nationwide. That, I mean, the only, the only path in the past for a Republican to win was through the electoral college, not through the, you know, through the nationwide vote. So what I’m getting at is it looks like it’s going to be impossible for them to cheat enough to win. And if they don’t win, they’re out of power. If they’re out of power, then all of these things that they’ve done over the last three years as far as weaponizing the DOJ, that’s going to be turned against them, and they know that.
So in order to not lose power, what is their only option? Cancel the election somehow. And that would be done with a false flag. And it would also, it would also kick markets over and close the banking system, close the stock market. So you, what I’m getting at here is when you close markets, people are going to beg for help and the help is going to be the CBDC.
That’s, in my opinion, that’s how they’re going to bring forth the CBDC. They’re going to have people begging for it. Yeah, but I mean, I understand what you’re saying, but from the polls about that, with, in regards to the central bank digital currency, many people are completely against it. I know there’s a lot of people in Congress that are completely against it. And I understand that they’ll use fear, they’ll use an event, they’ll try to push it, and they’ll do, you know, let’s talk about protecting ourselves.
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But when we’re going, when you just mentioned the elections and they’re gonna, you know, is the 50 50th chance of them not having the elections, do you think they’ll use the illegals in a way to maybe shut it down or scare people from going to the poll centers or something? Yeah, that’s possible. I think it’ll be more likely some type of war event or maybe another pandemic. I mean, who knows? There’s probably a hundred, there’s probably 500 or 1000 different possibilities.
Who knows what it’s going to be. But I just see them using some type of event to cancel the elections so that they don’t lose power. And let me just comment. You mentioned this looks like 2007, 2008. Yes, it really does. But there’s one huge difference, and I missed it at the time because I never believed that central banks and sovereign treasuries would destroy their balance sheets to save the system.
And that’s what they did. I mean, you’ve got now back in 2007, 2008, the central banks and the sovereign treasuries, they weren’t in the greatest shape, but they did have the ability to come to the rescue. That ability is gone because now you have the world completely indebted. You’ve got the US. The reserve currency of the world is at 130% of debt, whereas old days 100% bet to GDP.
You were walking through the door to a banana republic and now you’ve got the reserve currency five steps into being a banana republic financially, not to mention judicially. So I think the biggest difference today is that there’s not a white knight out there that can come in and, and create trillions of more dollars to save the system. They’re going to try to do it and that will destroy the fiat currencies worldwide.
And you’ll see gold moving on a daily basis more than what it’s priced at right now. I just want to go back to the time where you said back in 2007, eight, nine, the central bank, they didn’t care about their, you know, their, their books. They didn’t care about their, you know, keeping everything whole. They just wanted to save the system. And that’s why we miss this. But this time they don’t have the ability to do anything.
That all that is gone. Everything is now gone. They, they have nothing to use. I mean, I guess, can they. I guess I missed, I missed that. I mean, the Fed had a balance sheet of $900 billion in 2006, 2007, and they blew it up to 9 trillion. They blew their balance sheet up tenfold, basically. And I did not believe that central banks and sovereign treasuries would ruin their own balance sheets to save the system.
At where we are right now, their balance sheets are completely ruined. I mean, you’ve got central banks now that are technically insolvent because of all the bonds that they had on their books have declined in value because they’ve raised interest rates. And when you raise rates, bonds go down. The Fed last year lost 114 billion and the last I saw, they had 65 billion in capital. So they have a negative, a negative balance sheet at this point.
And that’s the same for the ECB, the Bank of Japan, the Bank of England. These central banks are no longer even solvent to step up and try to save a system that is much larger than it was in 2007. Eight, nine. The derivatives market is much larger than it was in that timeframe. So the system is much bigger. And the central banks and sovereign treasuries are now frail or fragile, whatever you want to call it.
So this is very interesting. I mean, I don’t know if you saw this, but Kyle Bass, he put something out there and he says that the Fed and the treasury, they’ve been both using their slush funds to inject enormous liquidity into the US markets, markets since 2023. And the Fed has another 400 billion to inject between now and the elections. So it looks like they’re using everything that they have to keep everything up.
And as we get closer and closer to the elections, I think they’re going to run out of that, the juice to keep the market up. Yeah, that’s possible. That they’re backdoor supporting. I would tell you to look at what the bank of Japan said and did yesterday or the day before, this is the first time they have positive interest rates since 2007. And they have been notorious for buying ETF’s and also buying reits.
They’ve supported the stock market and they’ve supported the real estate market going all the way back to 2007. Now they say they’re no longer going to be buying ETF’s, they’re no longer going to be buying the reits. If I was an investor in Japan, I would have sold everything I had yesterday right after that announcement. Because if they’re truly not going to support the markets, the markets are going to crash because they’ve.
We’ve been on life support since 2008, and there’s no way. There’s, there’s no way the system, the entire financial system can survive without life support. So going back a couple of years, maybe two years, you mentioned that when we do have this crash, the system’s going to come down and then it’s going to be prop back up and then we’re going to have another crash. Are you still thinking the same thing is going to happen? Yeah, I think what you’re referring to is I believe there’s going to be more than one reset.
I think the first reset, they are going to kick the table over or let the table just fall over. Right. They will try to bring forth the central bank digital currencies. It may take two weeks, it may take two months. I can’t imagine taking more than six months. But that’s going to fail because this, any CBDC is still going to be fiat, going to be backed by the same broken full faith and credit of the US government.
So that’s going to fail. Then you’re going to have a more natural, call it Mother Nature type reset and understand the rest of the world wants this to happen. They’re tired of being. Of having the dollar, the dollar boot on their neck. And that’s really the genesis behind the Bricks is that they want free and fair trade settlement. They want to trade something for something rather than sending something real and getting something in return.
That is nothing. And that’s what us dollars. So you’re going to have the rest of the world applauding the collapse of the west and the power of the capital will evaporate in the west and it will end up in the east. And then what happens to, I guess, the currency here? I guess the Federal Reserve is then done and we don’t have federal reserve notes anymore. Do we go back to the constitution where it says we? That would be a good plan.
I would just say if you were Chinese or you were russian or pick any country really, that’s a part of the BRICS. Are you going to accept dollars? You’re probably not going to accept dollars at all. We’ve already seen the UAE has come out and said we will accept all fiat currencies for oil except for dollars. I mean, can you imagine what happened 20 years ago when Saddam Hussein said that? What happened to Gaddafi? We went in and we invaded and what was the first thing we stole? We stole their gold.
Can the US really go in and invade the entire world because they’re no longer using our dollars? No, the. I mean, the answer, you know, a laughable no, there’s no way. As I said, it is the end of empire. So I guess what’s happening really right now is there’s going to be a reset of currency around the world. Absolutely. Yeah. Yeah. There’s going to be a reset of currencies and there’s going to be a massive reset of asset pricey versus, versus currencies versus gold versus other assets.
Everything is going to. It’s almost like they’re going to shake up a container and the water is going to find its own level. I guess it’s very, very similar from the set. I mean, not as bad, but in the seventies when we came off the gold standard, there was a shakeup. I mean, there was a little bit of a reset going to full fiat. And that’s why you saw the high interest rates, you saw the gas lines, you saw countries having problems because that was kind of like a mini type of reset coming off of gold and going on to the petrodollar.
This time around, we’re completely, I’m assuming we’re completely detaching ourselves from the central bank system this time around. And we’re going to have to do something to either go back to gold or some type of sound money to basically level off the system somehow. I mean, when we came off of gold in the seventies, they leveled off by increasing the interest rates to 17, 16% and, you know, they were printing and.
But this time around they’re going to have to do something. Well, there’s a big difference between now and call it 1970, 119, 73 with the petro dollar. Back then, the US was what, 30, 35% debt to GDP, right? Wet to GDP. You could look in the corporate sector, you could look in the personal sector. The pervasiveness of debt back in 1973 did not exist, and now there’s nothing but debt.
The other difference is that back in 1973, the US military was still the most feared military on the planet. I mean, China was not a threat. They had a lot of men, they had a lot of boots, but they didn’t have, they hadn’t built up their military. Russia was the only one that could stand against us, and the only thing they had were basically the same nuclear weapons we had.
Fast forward to today, the US has fallen behind horribly from a technology standpoint. I mean, Russia has hypersonic. The US has not even had a hypersonic test that worked. So we don’t have hypersonic. None of our weapons can catch any of their weapons. So the US military is no longer the most feared on the planet and can’t force the rest of the world to use dollars. So those are the two big differences between now and then.
The balance sheet wasn’t completely upside down like it is today, and the military was still the strongest military on the planet. But you think this is going to happen most likely around the election, the 2024 election? Yeah, I think there’s going to be some big stuff happen before the election. As I said, I think there’s greater than a 50 50 chance that we do not have an election.
Now, if that happens, you could ask why. What was the event? What happened? I have no idea. But whatever it is, if it’s big enough to stop an election, it’s big enough to topple a financial market, it’s standing on the head of a pin. So when this is all. And thus the real economy too. Yeah. So obviously the real economy seizes. So when everything’s said and done, do you think the central bank will exist anymore? I mean, if the brics are moving away, the.
And I mean, like, I’m talking about the IMF, I’m talking about the Fed, I’m talking about the ECB. Will they still be in existence? Because if their currency goes down the tubes, will they still be around? It depends on the timeframe you’re asking. In three to five years, maybe not. But within that three to five year time period, they’re going to try as hard as they can to replace this currency, replace that currency and convince people, oh, well, the old currency was bad.
This is a. This is a good one. I would view it as similar to Weimar Germany, where they went from the Reich mark to the Renton mark that ultimately failed. It didn’t write itself until they went back to real currency, gold. The gold mark. Gold has got to be the foundation to the financial system because it’s the only money that cannot default. Right now, the financial system is supported 100% by US treasury bonds because for what, 50, 70 years, it was thought the US treasury can never default.
It’s the safest asset on the planet. But now we’re getting to a point where, hey, wait a minute, it’s not the safest asset on the planet because there’s a question as to whether they can ever pay it back. And it’s not really a question because, I mean, you look at the math, paying the debt back, let alone paying the interest on it, each year, the US cannot. They can’t pay it.
The US can’t open its doors of whatever the fiscal, first fiscal day is, October 1, they can’t open their doors without knowing that they’re going to have to borrow a. Another trillion, five to 2 trillion. I mean, it would be hard, it would be very difficult to pay just the interest if they weren’t, if they weren’t borrowing more. And really that’s what we’ve done over all these years, is we’ve borrowed money, we’ve borrowed more and more money to pay, you know, to pay on the debt.
And think about this, Dave, 34 trillion go back to 1980. I think that was the first year we went over a trillion dollars for the total debt. So we’ve added 33 trillion since 1980. So what you’re looking at is what, in 40 years we have our standard of living has been goosed by $33 trillion. What would our standard of living be right now? And what would it have been for the last 40 years if we didn’t spend and borrow more than we produced and took in an income taxes standard of living would be.
Our standard of living would be. Would. Would be in the toilet. It would. I mean, from where we are now. It would be an outright depression from what we’re talking about and everything that we’re seeing. What one thing should people do to prepare? I guess you’ve got to look at this from several angles. You got to look at it from your personal, your life and your lifestyle angle.
You’ve got to look at it also from a financial angle. The financial angle is easy. Get out of the system and get your capital into things that can’t default. And the most obvious are gold and silver. Those are the only monies that can’t default from a personal standpoint. Just look at what’s happened with the illegal immigration or illegal invasion, whatever you want to call it. If you live in a city and you think you’re going to survive what’s coming, good luck to you.
It’s not going to happen. You’re going to be overrun. You need to get yourself situated in a more rural area, a more rural situation where you at least have the ability to try to provide for yourself, because there’s going to be a point in time where it’s every man for himself. And hopefully, if you’ve gotten yourself into a rural area, you can assimilate with neighbors, with the community, where the thought process is more like it was back in the 1930s, where neighbors helped neighbors as opposed to the way it is in cities right now.
Somebody falls and what happens? They get robbed. They end up. They’ve lost everything, their shoes. And 2 hours later an ambulance shows up, maybe. So there’s really a bike. What I’m getting at is there’s a bifurcation as to where you’re situated, whether it’s urban or whether it’s rural. And if you’re urban, you’re not going to make it. Hey, Bill, thank you very much for being on the x 22 report spotlight once again.
If people want to see your work, where should they go? You can go to my website. It’s almost a year old now. It’s billholter. com. There is a contact button which will. I think my email pops up and you can just start writing. Or if you want to contact me directly, I have recently changed my business email. It’s now behalterroton me. I’ll be putting the links at the bottom of the video to make it easier for people to go right over to your site and everything.
Bill, once again, thank you very much for being on the spotlight. I really appreciate it. Thank you, Dave. Thank you. .
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